A press release said that in its combined role as trustee, 8038-CP calculation agent, and rebate analyst on a Direct Pay Bond issuance, BNY Mellon Corporate Trust will have the data to perform the required calculations and can deliver a package of reports, statements, schedules and project-related documents, both shortly after issuance and throughout the life of the issue, to help the issuer meet IRS requirements.

According to the announcement, the new service was developed to help issuers of Direct Pay Bonds, such as Build America Bonds and Recovery Zone Economic Development Bonds, which are a new category of bonds permitted under The American Recovery and Reinvestment Act of 2009. The recent Hiring Incentives to Restore Employment Act established that issuers can choose Direct Pay status for four other types of municipal bonds, as well.

“There has been a general shift in the municipal bond market industry toward more regulation and stricter compliance enforcement, which includes the IRS regulations related to Direct Pay Bonds,” said Alex Tsarnas, managing director and head of the Corporate and Public Finance Group within BNY Mellon Corporate Trust, in the announcement. “Our compliance reporting service helps issuers of Direct Pay Bonds by providing them with all of the reporting capabilities they need in one place, eliminating the hassle and frustration of going to several entities for the required reports and calculations.”